The World Economic Forum (WEF) published a report on Wednesday that nearly 40 central banks from across the world, are currently or soon will be, researching and experimenting with central bank digital currency (CBDC).
In a foreword authored by Ashley Lannquist, Project Lead, Blockchain and Distributed Ledger Technology, at World Economic Forum says, “CBDC, a commonly proposed application of blockchain and distributed ledger technology (DLT), has attracted much interest within the central banking community for its potential to address long-standing challenges such as financial inclusion, payments efficiency, and payment system operational and cyber resilience. Including but not limited to CBDC, central banks are researching and experimenting with at least 10 specific use cases for blockchain and DLT, exploring where they can potentially unlock new possibilities and improve inefficient processes.”
Citing examples such as Bank of Canada, the Bank of England, and the Monetary Authority of Singapore (MAS), the report stated these were the central authorities that initially started a conversation around, DLT and its many use cases. The report added that many other central banks from countries such as Lithuania, Thailand, Brazil, Germany, Hong Kong are also leveraging blockchain technology to facilitate ease of payment.
In a conversation with news portal CoinDesk, Lannquist said, “Pilot and experimentation work thus far on this subject has yielded some mixed results, some optimistic results, and the summary of where we are right now is that central banks are proceeding with caution, yet highly involved in research.”
She added, “I’d say in the next couple years, speculating towards the future and being a bit conservative, I would expect a couple central banks to issue a central bank digital currency and that’s because we know that at least a few are.”
The report further stated that the National Bank of Cambodia will be one of the first countries to use blockchain technology in its national payments systems for use by consumers and commercial banks.
This is an interesting standpoint, compared to earlier this year, when the gathering at Davos organized by the WEF saw a muted response, compared to previous years’ excitement.